News by the Barrel
By Matthew Roberts, Certified General Real Estate Appraiser
There is a lot happening in the real estate market these days. I’m sharing a few articles I know you will find interesting.
Illinois Housing Market
The State of Illinois is facing financial uncertainty and a net loss of population annually. Residents and prospective residents may be concerned how the state will address its fiscal problems. Will it be with higher property taxes? The Illinois housing market has certainly been restrained by higher unemployment than surrounding states and yearly population loss. What effect is this having on the Illinois housing market? The Illinois Realtors Association provides a snapshot:
Illinois Realtors market statistics
Also have a look at this graph tracking median Illinois sales price:
June 2019
Four Stories This Month
A roundup of real estate and farm news worth a look.
Illinois Housing
Financial uncertainty, population loss and higher unemployment
Rain, Rain Go Away
Millions of acres planted late or not at all after a wet spring
Iowa Farmland Values
Stable‑to‑increasing values despite declining farm income
Hybrid Appraisals
A third party, not the appraiser, observes the property
Farm · Commercial · Home appraisals | Missouri · Illinois · Iowa
Rain, Rain Go Away
Millions of acres of farm ground were planted late or not planted at all due to the very wet spring soaking the Midwest.
Washington Post: Weather woes cause American corn farmers to throw in the towel
Farmland Values in Iowa
According to the Federal Reserve Bank of St. Louis, Midwest farmers continue to face declining farm income. Lenders also report declines in farm income compared to one year earlier. Commodity prices could always be higher of course, but their potential is being dampened by many factors, often regional or national, and often outside the farmer’s control. And yet, despite all this, farmland values remain stable-to-increasing. So, do farmland prices reflect reality?
Midwest Farmland, 2019
Do Prices Reflect Reality?
Two trends moving in different directions.
Farm income
Declining
Midwest farmers continue to face declining farm income, per the Federal Reserve Bank of St. Louis
Farmland values
Stable to increasing
Despite lower income and dampened commodity prices
Farm · Commercial · Home appraisals | Missouri · Illinois · Iowa
Appraiser Impostors and Hybrid Appraisals
Fannie Mae is attempting to 'modernize' the lending process by reducing the scope of the appraiser's work. What could go wrong? A Hybrid Appraisal is basically a desktop appraisal, performed by a licensed/certified appraiser, but where a third party performs the observation of the subject property, taking relevant photos and notes. Desktop appraisals aren’t new, but what is new, is outsourcing the physical visit of the subject property to someone without a license. Appraisers are professionals held to high standards and are required to pass background checks for licensure. But with a Hybrid Appraisal, the person who is performing the inspection in the place of the appraiser could be anyone, and there is no way to know who is walking through your home during this site visit. Under the (false) assumption that having a non-appraiser go to the subject property and perform the appraisal inspection will speed up the appraisal process, the Hybrid Appraisal adds liability and risk to nearly every party involved.
AppraisersBlogs: Cheap appraiser imposters vs. qualified appraisers
Appraisal Scope
Traditional vs Hybrid
Who visits the property makes the difference.
Traditional appraisal
Appraiser Visits
- A licensed/certified appraiser inspects the property
- Appraisers are held to high standards
- Must pass background checks for licensure
Hybrid appraisal
Third Party Visits
- A desktop appraisal by a licensed/certified appraiser
- A third party observes the property, taking photos and notes
- That person may be unlicensed; no way to know who it is
Farm · Commercial · Home appraisals | Missouri · Illinois · Iowa
Spurgeon Appraisals regularly appraises a variety of property types. We have experience appraising farms, residences, and commercial properties. We pride ourselves on providing excellent customer service and quality appraisals. Contact our team to see how we can meet your appraisal needs and exceed your service expectations.
